1. Top Company holds 90 percent of Bottom Companys common stock. In the current year, Top reports sales of $826,000 and cost of goods sold of $619,500. For this same period, Bottom has sales of $371,000 and cost of goods sold of $222,600. During the current year, Bottom sold merchandise to Top for $178,000. The parent still possesses 20 percent of this inventory at the current year-end. Bottom had established the transfer price based on its normal gross profit rate. What are the consolidated sales and cost of goods sold? $1,019,000 and $675,970. $981,900 and $856,340. $1,019,000 and $678,340. $1,019,000 and $699,700. 2. On January 1, Jarel acquired 80 percent of the outstanding voting stock of Suarez for $260,000 cash consideration. The remaining 20 percent of Suarez had an acquisition-date fair value of $65,000. On January 1, Suarez possessed equipment (5-year life) that was undervalued on its books by $25,000. Suarez also had developed several secret formulas that Jarel assessed at $50,000. These formulas, although not recorded on Suarezs financial records, were estimated to have a 20-year future life. As of December 31, the financial statements appeared as follows: Jarel Suarez Revenues $ (300,000 ) $ (200,000 ) Cost of goods sold 140,000 80,000 Expenses 20,000 10,000 Net income $ (140,000 ) $ (110,000 ) Retained earnings, 1/1 $ (300,000 ) $ (150,000 ) Net income (140,000 ) (110,000 ) Dividends declared 0 0 Retained earnings, 12/31 $ (440,000 ) $ (260,000 ) Cash and receivables $ 210,000 $ 90,000 Inventory 150,000 110,000 Investment in Suarez 260,000 0 Equipment (net) 440,000 300,000 Total assets $ 1,060,000 $ 500,000 Liabilities $ (420,000 ) $ (140,000 ) Common stock (200,000 ) (100,000 ) Retained earnings, 12/31 (440,000 ) (260,000 ) Total liabilities and equities $ (1,060,000 ) $ (500,000 ) Note: Parentheses indicate a credit balance. During the year, Jarel bought inventory for $80,000 and sold it to Suarez for $100,000. Of these goods, Suarez still owns 60 percent on December 31. references What is the consolidated total of noncontrolling interest appearing on the balance sheet? $70,500. $87,000. $85,500. $83,100. 3. On January 1, 2014, QuickPort Company acquired 90 percent of the outstanding voting stock of NetSpeed, Inc., for $810,000 in cash and stock options. At the acquisition date, NetSpeed had common stock of $800,000 and Retained Earnings of $40,000. The acquisition-date fair value of the 10 percent noncontrolling interest was $90,000. QuickPort attributed the $60,000 excess of NetSpeeds fair value over book value to a database with a 5-year remaining life. During the next two years, NetSpeed reported the following: Income Dividends 2014 $ 80,000 $ 8,000 2015 115,000 8,000 On July 1, 2014, QuickPort sold communication equipment to NetSpeed for $42,000. The equipment originally cost $48,000 and had accumulated depreciation of $9,000 and an estimated remaining life of three years at the date of the intra-entity transfer. a. Compute the equity method balance in QuickPorts Investment in NetSpeed, Inc., account as of December 31, 2015. b. Prepare the worksheet adjustments for the December 31, 2015, consolidation of QuickPort and NetSpeed. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)